WASHINGTON (CNN) -- President Obama pledged Monday to make good on his promise to transform the Department of Veterans Affairs and said he would "dramatically improve" mental health aid.

President Obama and Veterans Affairs Secretary Eric Shinseki, seen here last month, vow to increase aid.

Flanked by Veterans Affairs Secretary Eric Shinseki, the president said his budget calls for a $25 billion increase in funding for the VA over the next five years -- a commitment that will be tested by the needs of veterans returning from Iraq and Afghanistan.

"With this budget, we don't just fully fund our Veterans Affairs health care program, we expand it to serve an additional 500,000 veterans by 2013," he said.

He promised that the VA would "dramatically improve services" related to mental health, post-traumatic stress disorder and traumatic brain injury, and he said homeless veterans would be targeted for support.

"Those heroes have a home," Obama said. "It's the country they served, the United States of America, and until we reach a day when not a single veteran sleeps on our nation's streets, our work remains unfinished."